Chapter 1501:9-5 Enhanced Recovery Projects

(A) "Enhanced
recovery" means any injection of natural gas, water, or other fluids approved
by the division into an oil or gas reservoir to increase pressure or retard
pressure decline in the reservoir for the purpose of increasing the recovery of
oil or other hydrocarbons therefrom and shall include secondary or additional
recovery operations. This is to include all thermal processes.

(B) "Input wells" means those wells into
which natural gas, water, other fluids or gases are injected, or are to be
injected, for the purpose of increasing pressure or retarding pressure decline
in the reservoir.

(C) "Withdrawal
wells" means those wells from which oil and/or gas is, or is to be, withdrawn.

(D) "Observation wells" means
those wells used, or to be used, temporarily for observation and not for input
or withdrawal.

(E) "Project owner"
means the person who has the right to inject fluids on a subject tract or
tracts and has the right to drill on a tract or drilling unit and to drill into
and produce from a pool and to appropriate the oil or gas that he produces
therefrom either for himself or for others.

(F) "Person" means any political subdivision,
department, agency, or instrumentality of this state; the United States and any
department, agency, or instrumentality thereof; and any legal entity defined as
a person under section
1.59 of the Revised Code.

(I) "Subject tract" means a tract upon which
a person proposes to drill, reopen, deepen, plug back, or rework a well for the
injection of fluids.

(J) "Well"
means any borehole, whether drilled or bored, within the state, for production,
extraction, or injection of any gas or liquid mineral, excluding potable water
to be used as such, but including natural or artificial brines and oil field
waters.

(K) "Existing well" means
any well for which a drilling permit was issued by the division prior to June
1, 1982.

(L) "Saltwater" means any
and all nonpotable water resulting, obtained, or produced from the exploration,
drilling, or production of oil or gas.

Chapter 1501:9-5 of the Administrative Code shall not apply to
saltwater injection wells, liquid waste disposal wells, natural or artificial
brine wells, wells drilled in a gas storage reservoir, or wells in which
natural gas from a pool is recycled in the same pool for the purpose of
retarding pressure decline, or wells for the exploration for or extraction of
minerals or energy, including but not limited to the mining of sulfur by the
Frasch process, the solution mining of minerals, the in-situ combustion of
fossil fuels, or the recovery of geothermal energy.

(A) No
enhanced recovery operation shall cause or allow movement of fluid into a
source of underground water, and no saltwater shall be injected into an
underground formation other than in a manner approved by the division.

(B) Except as authorized by the
division, any construction, conversion to, or operation of an enhanced recovery
project is prohibited.

Any person who proposes to construct, convert to, or operate an
enhanced recovery project shall submit an application for a permit to the
division on a form provided by the division.

(A) Permit required. No person shall conduct
an enhanced recovery project unless an appropriate application for such a
project has been approved by the chief and a permit issued by the division. In
addition to a project permit, no person shall drill, reopen, deepen, plug back,
rework, or use a well for input, withdrawal, or observation unless an
appropriate drilling permit as required in Chapter 1509. of the Revised Code
has been approved by the chief and issued by the division.

(B) Area of review. An application for an
enhanced recovery project filed with the division under this rule shall be
evaluated on the basis of an "area of review" surrounding the input wells
proposed for the project. The area of review shall be the area encompassed by
the following:

(1) The areas circumscribed by
circles of one-half-mile radii with their center points at the locations of
each input well in which injection of greater than an average volume of two
hundred barrels per day per year is proposed;

(2) The areas circumscribed by circles of
one-quarter-mile radii with their center points at the locations of each input
well in which a maximum injection of an average volume of two hundred barrels
per day per year is proposed; and

(3) The areas circumscribed by circles of
one-quarter-mile radii with their center points at the locations of each input
well in which gas is used as the injected fluid; or

(C)
Application for permit. The application for a permit to conduct enhanced
recovery operations shall contain the following:

(1) The name and address of the project owner
and his signature or that of his authorized agent. When a person signs as an
agent, a certified copy of his appointment shall accompany the application or
be on file with the division;

(2)
The names and addresses of all holders of the land owner's royalty interest of
record, or holders of the severed oil and gas mineral estate of record in the
subject tract;

(3) The names and
addresses of all owners or operators of wells within the area of review
producing from or injecting into the same formation proposed as the injection
formation;

(7) The name, description, and depth of the
geological zone or formation to be utilized, including, if existing wells are
to be utilized, an accurate drillers log, geological log, or electric log the
proposed input well or wells, and any testing data on any such well or wells;

(8) The type and the estimated
average and maximum amount of gas, water, or other fluids to be injected daily
into each input well, or project, if a manifold system is utilized, and the
method which will be used to measure the actual amount of fluid injected;

(9) The estimated average and
maximum pressure to be used for injecting fluid into the proposed input well or
wells, and the method which will be used to measure the actual daily injection
pressure;

(10) The designation of
all proposed or existing input, withdrawal, and observation wells;

(11) If required so as not to violate rule
1501:9-4-04 of the Administrative Code, a proposed corrective action of wells
penetrating the proposed injection formation or zone within the area of review;

(12) A schematic drawing of the
surface and subsurface construction details of the proposed input well or
wells; and

(13) The information
required by section 1509.06 of the Revised Code and
any other information the chief may request to ensure compliance with the
statutory requirements of the division.

(D) Map. Each application for a permit shall
be accompanied by a map or maps showing and containing the following
information:

(1) The subject tract or tracts
of land and their owners upon which the proposed enhanced recovery operations
are to be conducted;

(2) All
tracts or parts thereof situated within the area of review labeled with the
names of all owners or operators of wells producing from or injecting into the
same formation proposed as the injection formation;

(3) The location and designation of all
input, withdrawal, or observation wells on the tract or tracts to be utilized
in the enhanced recovery project; and

(4) The geographic location of all wells
penetrating the formation proposed for injection, regardless of status, within
the area of review.

(1) Notice of application for a permit for an
enhanced recovery project shall be given by the following method:

After the submittal of an application for an enhanced recovery
project permit, the division shall, within five working days, review the
application to verify that the required information has been submitted. After a
determination by the division that the application is complete as required by
this rule, it shall be date-stamped by the division and the applicant shall be
notified. Notification of the application shall be published by the division in
the weekly circular in accordance with section
1509.06 of the Revised Code. In
addition, legal notice shall be published by the applicant in a newspaper of
general circulation in the county in which the proposed project is situated. A
copy of the notice shall also be delivered to all owners and operators of wells
within the area of review producing from or injecting into the same formation
proposed as the injection formation. Proof of publication, publication date,
and an oath as to the delivery to those entitled to personal notice shall be
filed with the division within thirty days after the application was
date-stamped by the division. The legal notice shall contain at least the
following information:

(a) Any person desiring to comment or to make
an objection with reference to an application for a permit to construct,
convert to, or operate an enhanced recovery project shall file such comments or
objections, in writing, with the "Underground Injection Control Section,
Division of Mineral Resources Management, Fountain Square, Columbus, Ohio
43224." Such comments or objections shall be filed with the division no later
than fifteen calendar days from the delivery of notice or from the publication
date in a newspaper of general circulation in the county in which the proposed
project is situated.

(b) If no
objections are received within the fifteen-day period, the chief shall consider
that no objection exists and shall issue a permit unless he finds that the
application does not comply with the requirements of Chapter 1501:9-5 of the
Administrative Code, or is in violation of law, or jeopardizes public health
and safety, or is not in accordance with good conservation practices.

(c) If an objection is received,
the chief shall rule upon the validity of the objection. If, in the opinion of
the chief, such objection is not relevant to the issues of public health or
safety, or to good conservation practices, or is without substance, a permit
shall be issued. If the chief considers any objection to be relevant to the
issues of public health or safety, or to good conservation practices, or to
have substance, a hearing shall be called within thirty days of receipt of the
objection. Such hearing shall be held at the central office of the division or
other location designated by the chief. Notice of such hearing shall be sent by
the chief to the applicant and to the person who has filed the objection.

(d) If the chief finds, after
hearing, and upon consideration of the evidence and the application, that the
following conditions have been met, the application shall be approved and a
permit issued; otherwise, the chief shall reject the application:

(i) The application complies with the
requirements of Chapter 1501:9-5 of the Administrative Code;

(ii) The proposed enhanced recovery project
will not be in violation of law; and

(iii) The enhanced recovery project will not
jeopardize public health or safety, or the conservation of natural resources.

(3) The
chief shall issue an order granting or denying the enhanced recovery project
permit authorization within twenty-one calendar days after the filing date of
proof of notice for a permit for which no hearing is held, or within thirty
calendar days following the completion of a hearing.

(1) Authorization, including a permit, to
construct, convert to or operate an enhanced recovery project shall not be
granted unless and until proof of financial responsibility for each input,
withdrawal and observation well in the project has been received and approved
by the division in accordance with section
1509.07 of the Revised Code.

(2) No assignment or transfer of
an enhanced recovery project permit by the project owner shall relieve the
project owner of his obligations and liabilities under Chapter 1509. of the
Revised Code and Chapter 1501:9-5 of the Administrative Code, unless the
assignee or transferee has filed, and the division has approved, proof of
financial responsibility for each input, withdrawal and observation well in
said project in accordance with section
1509.31 of the Revised Code.

(G) Display of permit.
No well for the purpose of input, withdrawal or observation shall be drilled,
reopened, deepened, plugged back, or reworked until the project owner has been
granted a permit and unless the original permit, or a true copy thereof, is
posted or displayed in a conspicuous and easily accessible place at the
wellsite.

(H) Well identification.
Once injection operations authorized by the enhanced recovery permit have
begun, the following information shall be posted in a conspicuous place on or
near the storage tank(s): owner's name, lease name, enhanced recovery project
number, county, township, and emergency telephone number. In addition, the
permit number of each input, withdrawal or observation well shall be displayed
in a conspicuous place on or near the wellhead.

(1) Drilling or conversion operations
authorized by a permit issued pursuant to Chapter 1501:9-5 of the
Administrative Code shall commence within twelve months after the date of issue
of such permit. If such operations have not started within twelve months, the
permit shall expire. If drilling or conversion operations have started but are
not completed within the twelve month period, operations shall continue with
due diligence or the permit shall expire.

(J) Change of location procedure. The
location of an input, withdrawal, or observation well shall not be changed
after the issuance of a drilling permit unless the project owner first obtains
approval from the division. If a project owner requests a change of location,
he shall return the original drilling permit and file an amended application
and map for the proposed new location. Construction operations shall not
commence at a new location until a proper permit has been received and posted
in accordance with section
1509.09 of the Revised Code.

(1) Any substantial change in the
enhanced recovery project proposal as submitted in the application shall be
reported to the chief at least ten days prior to the beginning of such change.
If such change conforms with Chapter 1509. of the Revised Code and Chapter
1501:9-5 of the Administrative Code and does not alter the basic proposal for
enhanced recovery operations, the chief shall issue written approval for such
change.

(2) If such change does
not conform with Chapter 1509. of the Revised Code and Chapter 1501:9-5 of the
Administrative Code, or is a radical departure from the proposal in the
original application, the chief may disapprove such change and request a new
application.

All persons engaged in any phase of enhanced recovery
operations shall conduct such operations in a manner which will not contaminate
the surface of the land, or water on the surface or in the subsurface.

No well used in enhanced recovery operations shall be drilled
or converted nearer than one hundred feet from any inhabited private dwelling
house; nearer than one hundred feet from any public building which may be used
as a place of resort, assembly, education, entertainment, lodging, trade,
manufacture, repair, storage, traffic, or occupancy by the public; nearer than
fifty feet to the traveled part of any public street, road, or highway; nearer
than fifty feet to a railroad track; nor nearer than one hundred feet to any
well. The chief may grant a variance to this rule for good cause shown. This
rule does not apply to a building or structure which is incidental to
agricultural use of the land on which it is located, unless such building is
used as a private dwelling house or in the business of retail trade.

In the event any word, phrase, sentence, or other portion of
Chapter 1501:9-5 of the Administrative Code shall hereafter be declared
invalid, such invalidity shall not affect the remaining portions and parts of
such rules adopted or promulgated by the chief.

(A) Each input well
permitted after June 1, 1982 shall be constructed in the following manner:

(1) Surface casing shall be free of apparent
defects and set at least fifty feet below the deepest underground source of
water containing less than ten thousand mg/L total dissolved solids or less
than five thousand mg/L chlorides, and sealed by circulating cement to the
surface under the supervision of the division. In the event cement fails to
circulate to the surface, the division may approve a remedial course of action.

(2) Isolation of injected fluids
shall be by the use of casing mechanically centralized and enclosed in cement
to a height no less than three hundred feet above the top of the injection
zone.

(3) Injection of fluids
shall be through tubing and a packer set no more than one hundred feet above
the injection zone and installation of such shall be under the supervision of
the division. A fitting to the tubing of a size and type specified by the
division on the permit and accessible at the surface shall be installed.

(4) To verify the quantity of
cement used in an input well, either a cement bond log, cement records, or
verification by the division of the number of sacks of cement will be deemed
sufficient evidence.

(5) Each
project owner or his agent shall give the appropriate mineral resources
inspector reasonable notice in advance of the time of the cementing, placing
and removing of casing, installation of tubing and packer, and initial
injection. A division office shall be notified when the appropriate inspector
cannot be contacted. Said work shall be done pursuant to the instructions of a
representative of the division in accordance with Chapter 1509. of the Revised
Code and Chapter 1501:9-5 of the Administrative Code.

(6) All saltwater or other fluid storage
facilities shall be constructed so as to prevent pollution to surrounding
surface and subsurface soils and waters.

(7) The chief may grant a variance to the
construction requirement established in paragraphs (A)(1), (A)(2), and (A)(3)
of this rule, if he determines that the variance sought will result in the
construction of an input well equivalent in its ability to protect underground
sources of water containing less than ten thousand mg/L total dissolved solids
or less than five thousand mg/L chlorides.

(B) Conversion of wells for input. Any well
permitted before June 1, 1982 may be converted to an input well if the
following criteria are met:

(1) The surface
casing shall be free of apparent defects and either cemented or properly sealed
with prepared clay through the deepest underground source of water containing
less than ten thousand mg/L total dissolved solids or less than five thousand
mg/L chlorides.

(2) Isolation of
injected fluids shall be by the use of casing enclosed in cement to a height no
less than three hundred feet above the top of the injection zone.

(3) Any open formation not to be utilized for
injection shall be abandoned in accordance with sections and
1509.15 of the Revised Code.

(4) Injection of fluids shall be
through tubing and a packer set no more than one hundred feet above the
injection zone, and installation of such shall be under the supervision of the
division. A fitting to the tubing of a size and type specified by the division
on the permit and accessible at the surface shall be installed.

(5) To verify the quantity of cement or clay
used in a conversion well, either cement or clay records, verification by the
division of the number of sacks of cement or clay, a cement bond log, or other
geophysical borehole logs shall be deemed sufficient evidence.

(6) Each project owner or his agency shall
give the appropriate mineral resources inspector reasonable notice in advance
of the time of the cementing, placing and removing of casing, installation of
tubing and packer, and initial injection. A division office shall be notified
when the appropriate inspector cannot be contacted. Said work shall be done
pursuant to the instructions of a representative of the division in accordance
with Chapter 1509. of the Revised Code and Chapter 1501:9-5 of the
Administrative Code.

(7) All
saltwater or other fluid storage facilities shall be constructed so as to
prevent pollution to surrounding surface and subsurface soils and waters.

(8) The chief may grant a variance
to the conversion requirements described in paragraphs (B)(1), (B)(2), and
(B)(4) of this rule if he determines that the variance sought will result in an
input well equivalent in its ability to protect underground sources of water
containing less than ten thousand mg/L total dissolved solids or less than five
thousand mg/L chlorides.

(C) Initial testing of construction. Prior to
commencement of injection operations in any input well, the casing outside the
tubing shall be tested under the supervision of the division. This test shall
consist of pressurizing the annulus between the tubing and the casing outside
the tubing to an amount equal to the maximum allowable injection pressure, as
described in paragraph (D) of rule
1501:9-5-10 of the
Administrative Code, or at a pressure of three hundred pounds per square
inch(psi), whichever is greater, for a duration of at least fifteen minutes
with no more than a five per cent decline in pressure, unless otherwise
approved by the division. In addition, any well in which a formation is
abandoned in accordance with paragraph (B)(3) of this rule shall, prior to
perforating, have the casing and plug pressure tested under the supervision of
the division at a pressure that is 1.25 times the maximum allowable injection
pressure as described in paragraph (D) of rule
1501:9-5-10 of the
Administrative Code. This test shall be for a duration of at least fifteen
minutes with no more than a five per cent decline in pressure unless otherwise
approved by the division.

The following provisions shall apply to the operation of all
enhanced recovery projects:

(A) A
well completion record in accordance with section
1509.10 of the Revised Code and
Chapter 1501:9-5 of the Administrative Code, shall be filed with the division
within thirty days after completion of or conversion to an input, withdrawal,
or observation well. This record shall include results of initial testing of
construction as described in paragraph (C) of rule
1501:9-5-09 of the
Administrative Code.

(B) The
project owner shall notify the appropriate oil and gas well inspector when
injection is to commence. A division office shall be notified when the
appropriate inspector cannot be contacted.

(C) Under no circumstances shall liquids or
waste matter from any source, other than freshwater, saltwater from oil and gas
operations, standard well treatment fluid, or other fluids approved by the
division be injected into any input well for which a permit is issued under
Chapter 1509:9-5 [1501:9-5] of the Administrative Code.

(D) The maximum allowable injection pressure
for the enhanced recovery project shall be determined by one of the following
methods:

(1) The formula pm=( 0.75 - pg)d;
where pm equals the maximum surface injection pressure (psi), 0.75 equals the
maximum allowable injection pressure gradient (psi/ft), pg equals the pressure
gradient of injection fluid (psi/ft), and d equals the depth to the shallowest
part of the proposed injection formation or zone on the subject tract or
tracts; or

(2) Such other formula
or test found to be accurate as applied to the facts presented in an
application and approved by the division.

(E) The injection well owner shall monitor
injection pressures and injection volumes for each input well on a daily
operational basis with average and maximum pressures and volumes compiled
monthly and filed annually with the division on a form supplied by the
division. If the enhanced recovery project is operating under a manifold
system, volume and pressure may be reported on a project basis.

(F) The annulus between the casing and tubing
shall be monitored during injection of fluids at least monthly at a pressure,
as noted on the permit, sufficient to detect leaks. Monitoring results shall be
reported to the division annually on a form supplied by the division.

(G) In the event the monitoring in
paragraph (F) of this rule is not feasible, as determined by the chief, the
project owner shall show mechanical integrity once every five years. Prior to
the commencement of any mechanical integrity test, the project owner shall
notify the appropriate oil and gas well inspector, or a division office when
the appropriate inspector cannot be contacted. All records of tests shall be
retained by the project owner for a period of at least five years or until a
subsequent mechanical integrity test is performed. Results of all mechanical
integrity tests shall be recorded on a form provided by the division and shall
be filed with the division within thirty days after the completion of the
mechanical integrity test. Mechanical integrity shall be shown by one or more
of the following methods:

(1) The casing,
tubing and packer shall be tested by pressurizing the annulus between the
tubing and the casing outside the tubing to an amount equal to the maximum
allowable injection pressure, as determined in paragraph (D) of this rule, or
at a pressure of three hundred pounds per square inch (psi), whichever is
greater, for a duration of fifteen minutes with no more than a five year cent
decline in pressure unless otherwise approved by the division;

(H) When
mechanical integrity failures or downhole problems cause contamination of the
land, surface waters, or subsurface waters, the project owner shall cease all
injection operations immediately until the chief determines that the problems
have been corrected. The chief may require the project owner to furnish a
written plan for testing or repairing the well or wells. Within five days of
receipt, the chief shall review the plan and either accept, modify, or if the
plan in inadequate, order necessary corrective action. The project owner shall
submit a description of the incident, the actions taken to correct the
situation, and the results of those actions on the next required annual report
as described in paragraphs (E) and (F) of this rule.

(I) The division shall have the authority to
sample injection fluids at any time during injection operations.

(J) Any input well which is or becomes
incapable of injecting fluids or any withdrawal well which is or becomes
incapable of producing oil or gas shall be plugged in accordance with sections
1509.13 and 2509.25 [
1509.25 probably intended] of
the Revised Code, unless written permission is granted by the chief. If the
chief finds that a well should be plugged, he shall notify the project owner to
that effect by order, in writing, and shall specify in such order a reasonable
time within which to comply. No project owner shall fail or refuse to plug a
well within the time specified in the order. Each day on which such a well
remains unplugged thereafter constitutes a separate offense.

The purpose of Chapter 1501:9-5 of the Administrative Code is
to prescribe minimum construction and operation requirements for enhanced
recovery projects so as to protect surface and subsurface soils and waters of
the state. Thus, the authorization or failure to authorize an enhanced recovery
project permit should not be construed so as to alter or amend any common law
property rights or responsibilities.